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Study Shows Meager Increase in Median Wages Since 1980

March 18, 2011Sam Williford

While average wage growth has remained flat during the past thirty years, median wage growth only saw a slight increase of 11 percent, despite each individual worker’s contribution to GDP soaring by 59 percent, according to a study by the Economic Policy Institute.

“This modest wage growth was not the result of a broken economy: rather, modest wage growth is the result of the way the economy has been designed to work. Essentially, economic policy of the last three decades has not supported good jobs. The focus instead has been on policies that claimed to make consumers better off through lower prices,” study author Lawrence Mishel wrote in his summary of his findings.

The increasingly bleak wage and labor statistics seen here in the U.S. are a direct result of our failed ‘free’ trade policies. By embracing unregulated trade with no form of economic protections, we have thrown out the baby with the bath water and have made it unprofitable to produce goods and employ workers in this country. Thus, the market has responded with lower wages and fewer jobs.

In order to return to full employment and a robust economy, the U.S. must return to trade practices that originally made this nation great, and that entailed protecting and encouraging the growth of our industrial sector. Manufacturing jobs provide good wages for all education levels (whether it be assembly workers, research and development or management) and spurs the development of other sectors of the economy.

Since embracing ‘free’ trade a few decades ago, our nation has seen declining employment (less people employed now than 10 years ago), stagnant wages (as this study shows) and a declining standard of living as the government and individuals have gone deeper into debt. We cannot solve a problem until we acknowledge there is one, and trade deficits caused by disastrous agreements such as NAFTA and the WTO are the reason for our economic woes, not the solution (as many claim with the current Korean free trade agreement).